The document analyzes Vietnam's consumer trends for 2015-2016, noting a significant rise in consumer and business confidence that is expected to boost spending. Key areas of growth include education, healthcare, and household products, alongside a burgeoning digital and smartphone market. However, concerns about rising costs of living and growing debt reliance pose potential challenges for the economy.

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THE GOAT IN REVIEW / THE MONKEY PREVIEW
VIETNAM CONSUMER TRENDS 2015 – 2016
Ralf Matthaes
Managing Director
Infocus Mekong Research

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79
68
56
51
82
86
0
10
20
30
40
50
60
70
80
90
100
2011 2012 2013 2014 2015 2016
A massive increase in Consumer and Business confidence over last 18 months indicates
that Consumer spend and business expansion should be on the rise.
Consumer Confidence Index (%): TNS 2011-2015 & Infocus CCI 2016 | Urban onlyx
2011 - 2016 Confidence Indices
79
48
56
78
59
X Business Confidence Index (%): Euro Cham Vietnam

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25%
48%
47%
18%
15%
11%
9%
35%
36%
36%
37%
29%
38%
32%
41%
17%
17%
45%
56%
51%
60%
Average %
Value of the Vietnamese dong
The cost of living
Employment
Vietnam's economy
My personal standard of living
Foreign investment
worse same better
Average
Perception of 2016 in terms of key economic indices
Key concerns for 2016 revolve around the value of the VND and the increase in the cost of
living, while FDI, personal standard of living and Vietnam’s economic prosperity are big
positives….
source: Infocus CCI Base: n = 512

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Will you spend More - The Same - Less in 2016 vs
2015?
45%
34%
38%
38%
40%
44%
44%
47%
48%
50%
55%
56%
47%
55%
55%
56%
49%
52%
38%
47%
44%
44%
41%
38%
Average %
Home appliances
Household utilities
Transportation
Personal quip. (phones/laptops, etc)
communications (tele.email)
Entertainment & dining out
Food & beverages products
Personal care products
House hold care products
Health care products/services
Education
more same less
source: Infocus CCI Base: n = 512
2016 should see continued growth in consumer spend. Education, Healthcare and
Household products should see the positive upswings in spend.
Average

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41
54
60
81
84
86
4
11
42
37
58
31
0 10 20 30 40 50 60 70 80 90 100
Smart TV
iPad /Tablet
Desktop
Laptop
Home Wifi Internet
Smart Phone
Urban Digital Ownership 2013
2015
Explosion of Digital & Smartphones
source: Infocus Base: n = 2,800
In a short two years, all that is smart / communications driven has exploded. Consumers
are craving connectivity / info / entertainment via personalized gadgets…

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Growth of high end / high cost items
111 000
157 000
215 000
290 000
0
50 000
100 000
150 000
200 000
250 000
300 000
2013 2014 2015 2016*
Automobile sales
Auto sales are indicative of Vietnamese
joining the developed world & upscaling their
lives
source: V.A.M.A
2
8 5
40
70
13
32
48
59
91
0
10
20
30
40
50
60
70
80
90
100
Vehicles Life
insurance
Credit |
Debit card
Air-con ATM Card
Urban ownership growth (%)
2013 2015
source: Infocus Base: n = 2,800
Huge growth in creature features and
security products, highlighting desire for
global integration
*estimate

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Percentage of consumer who took out loans in
2015 & why?
36
25
20
5
5
5
0 10 20 30 40
Lower income
Total
Higher income
Yes Yes More than 1
An astonishing 30% of those surveyed took out bank loans in 2015 & 41% of lower income
earners, mostly for real estate (35%) & business investments (25%).
5%
35%
24%
13%
9%
14%
Purpose of Loan
Automobile
Real Estate
Business
Education
Personal
Others
Take out Loan
source: Infocus CCI Base: n = 512

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FMCG Value & Volume growth % 2013-2015
10,1
4,3
3,2
4,7
1,6 2
0
2
4
6
8
10
12
2012-2013 2013-2014 2014-2015
Urban Value / Volume Growth %
Value % Volume %
10,5
11,8
8
7,4
9,4
6,4
0
2
4
6
8
10
12
14
2012-2013 2013-2014 2014-2015
Rural Value / Volume Growth %
Value % Volume %
Overall FMCG growth is down from last year, partially driven by a reduction of CPI (0.3% YoY
end of November), but also largely due to limited increases in salaries, bonuses and a sense
that consumers have different spending priorities.
source:

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19
11
2
4
15
12
4,2
3,1
0
2
4
6
8
10
12
14
16
18
20
2012 2013 2014 2015
FMCG Modern vs General Trade Value Growth (%)
Modern General
Modern vs General Trade FMCG Value Growth (%)
The past 3 years have seen a huge drop of both Modern & General FMCG value growth in
urban Vietnam, indicating either saturation or consumers tightening spend for other trade
offs. Modern Trade is showing a positive increase for the 1st time in years, though small.
source:

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Media spend by Medium: 2013 – 2015 (US Billion)
1 320
1 537
1 719
98
84
77
34
0 200 400 600 800 1 000 1 200 1 400 1 600 1 800
2013
2014
2015
TV Print (all) Digital Radio
Overall Media spend grew by 10% in 2015. TV makes up over 90% of all measured
advertising spend, yet the mobile phone is becoming the # 1 source of time being spent in
urban Vietnam, yet digital spend is still negligible…. Makes you wonder!!!
source:

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Daily activity do you do most, when not
working?
29%
5% 9%
Using Smart Phone
Using Laptop / PC
Watching TV
Others
source: Infocus CCI Base: n = 512
2%
26%
25%
18%
29%
0% 10% 20% 30%
1 hour or less / day
1-2 hours / day
2-3 hours / day
3-4 hours / day
4 plus hours / day
Most popular daily activity (%)
Major shift in consumers activities to mobile and on-line. Over half of urban consumers note
mobile usage as #1 activity, of which ¼ spend 4 plus hours a day on their mobile. Vietnam
has caught up very quickly….
57%
Time spent on your favorite medium(%)

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The growth of smartphone opportunity in Vietnam
68
57
49
39
32 43 51 61
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2013 2014 2015 2016 est.
Smart vs Feature phone share growth (%)
Feature Phone Smartphones
Smartphone ownership is the single largest consumer growth opportunity in Vietnam, with
an average growth rate of over 30% annually.
With urban Vietnam already over
80% penetration, the last
conquest is rural Vietnam,
changing the face of
communication forever…
Are you READY!
source:

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2016 Predictions
„The trouble with our times is that the
future is not what it used to be.”
Paul Valery

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Vietnam is out of recession, but…
2015 KEY GROWTH TRENDS 2016 PREDICTIONS
Positives = Confidence, Growth & Spend
1
Business & Consumer confidence have
increased substantially, driving growth
Increase investment and consumer spend should
make 2016 best year ever, in terms of overall growth
2
Over 25% growth of Digital & Mobile
connectivity
Much more opportunity for digital content,
messaging and overall connectivity…
3
Gradual increase in FMCG spend in
Modern Trade
Continued growth in modern trade with potential
uplift for overall FMCG spend
4
Growth of Banking, Education, Healthcare
spend, etc.
Accelerations of all, so long at CPI stays in check
Negatives = debt culture aligning with China?
1
VN becoming debt reliant / credit culture,
borrowing to catch up with the “Nguyens”
Any major global crisis / currency destabilization,
could be devastating for Vietnam due to bad debt
2
New laws on investment, enterprise, real
estate, etc., yet to see impact - Danger!
Fear of mass speculation and skyrocketing inflation
as in 2008…

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Cam On
Ralf Matthaes | Managing Director
ralf.matthaes@infocusmekong.com
mobile: +84-903-949-531